TaxTMI 
TaxTMI 
2005 (9) TMI 334
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....arts from Eclipse USA and Eclipse U.K. he sells package systems to OEMs and end-use of the imported goods, the appellant gets a discount of 40% to 53% when goods were supplied by the Parent Company in USA and 40% to 45% when they are supplied by other group company in U.K. The original authority disallowed this discount mainly on the ground that the appellant is a related to the supplier (being a 100% subsidiary) and such relationship has affected the price at which the goods are transacted. He however allowed a discount of 20% which is available to other non-related buyers such as resellers to whom the suppliers also sell the goods in India. It may be mentioned that the suppliers in USA and UK sell the same goods to other unrelated buyers ....
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....ercial levels of transactions are different and that the higher discount enjoyed by him is not governed by the fact that he is a related person. The parent company has a worldwide sales policy according to which different levels of discount are permissible depending on the person to whom the goods are supplied. Thus a subsidiary gets a better discount compared to resalers. It is argued that the Commissioner ought to have appreciated the fact that the appellant does not get any preferential price compared to others such as 'Resalers'. The latter get a lesser discount because they do not carry any risk unlike the appellants. 6.  The ld. DR argued that the appellant does not dispute the fact that he is a subsidiary of the supplier-comp....
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.... transacted is acceptable. 8. Rule 4(3)(b) provides an opportunity for the importer to demonstrate that the transaction value closely approximates to a test value previously accepted by a proper officer of customs. A number of factors should be taken into consideration in determining whether one value 'closely approximates' to another. The nature of the imported goods, the nature of industry itself and whether the difference in value is commercially significant are some of the factors to be considered before the declared value is accepted. 9. This being the position in law we may examine the present case in the light of evidence produced and arguments advanced by both sides. The appellants claim that the difference in prices....
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....him is less than the same goods are sold to others also does not hold water. 10.  If the appellant is suggesting that the price difference is due to the fact that what he imports cannot be sold in the market but could be used only in the manufacture of finished goods and that is the condition under which the goods are offered at a price lower than what is offered to others that itself is enough to reject the transaction value under Rule 4 of the Valuation Rules. And once it is rejected the Department can determine the value in accordance with law. In the present case the Department found that the same goods are offered for sale to other unrelated buyers. Adoption of that price as a transaction value is well within the law. The appel....